Initial Coin Offering (ICO) has earned a bad reputation recently as investors are losing money. Scams are not always the case, but in many instances, many legit projects cannot deliver what they promised. Running an ICO was easy in the past, you just needed a website, a whitepaper, and a community. The first wave of ICO investors rushed to buy anything they could get and the number of projects was too low during that period. However, with the popularity of ICO, many developers and projects have now started their own ventures. Investors now have many options to choose from which basically confuses them. 9 out of 10 legit projects cannot survive after the ICO. From our research, we found 5 things that could impact the project and investors must dig into those things to prevent them from investing in flop projects.
Marketing plays an important role in the exposure of the project. No matter how great your idea is if people don’t know anything about it then nobody is going to invest in the project. Promotion and marketing should continue and a budget must be always allocated. But most of the ICO projects are exhausted and don’t have a budget to promote after the ICO which results in the failure of that project. So as an investor, you need to always ask for the marketing plan and if possible can ask for the budget allocation for the presale stage and after launch. If the team is not able to provide sufficient evidence for their marketing budget and just promises you can get an idea that the project is not going to survive for long despite having a successful ICO.
After an ICO there is no time as the project gets launched and trading starts. The product and development must be completed before launch. Investors need to look and ask for the prototype and test for themselves if the product offers any new solution to the market or not. Also, don’t forget to check if the product the team is offering already exists in the market or not. It’s important for the project to have users of their project before rushing to an ICO.
The partnership is the best form of promotion and marketing. Cross-promotion helps projects get much-needed attention from investors and communities. But the partnership must be strategic and benefit both parties. Investors must always ask for the partnership and ask how it’s going to benefit both projects. Many partnerships can be bought in the market so stay alert and ask as many questions about the projects. The success of the project is very much dependent on the partnership and so it must be strategic and beneficial for the project.
Listing is very important for the project to get new holders and investors. Without new investors and holders project cannot move forward. All the listings must be preplanned even before ICO. It’s best to bet on the projects which are serious about listing and have enough budget to few CEX after launch. Investing in ICO can only be beneficial if the project is able to list the project on as many platforms as possible. Usually, a huge pump comes in after a new listing followed by a dump. So investors and projects must be ready for the pump and dump. Projects must have enough resources and budget to play in the market in order to protect their investors from the crash. There must be a huge buyback plan. Investors should confirm by themselves and ask for evidence from the team that they can contain huge selling pressure from the market. Otherwise, it’s wise to sell after the new listing in order to profit from the ICO.
Most of the project owners lack financial knowledge as their background is in technology. Any project must have financial literate in the project. The major reason why projects fail is the lack of financial management. From designing Tokenomics to budget allocation must be done under the supervision of an expert who understands the market. It’s best if the team has an expert in their team if not then an expert should be consulted before ICO. The only project that is able to manage finance has a high chance of thriving.
There are many factors that affect investing but if these 5 tips are followed then there is a high possibility that an investor can find whether a project will survive after ICO or its journey will end with it. Never hesitate to ask questions in the discussion forum of the project. The team must provide answers and sufficient proof that their journey is beyond the presale stage. If you don’t get any evidence then it’s wise to sell as quickly as possible so you don’t incur any major loss.